A marketing research company is estimating the average total compensation of CEOs in the service industry. Data were randomly collected from 18 CEOs and the 98% confidence interval for the mean was calculated to be ($2,181,260, $5,836,180). What additional assumption is necessary for this confidence interval to be valid?
A) The population of total compensations of CEOs in the service industry is approximately normally distributed.
B) None. The Central Limit Theorem applies.
C) The sample standard deviation is less than the degrees of freedom.
D) The distribution of the sample means is approximately normal.

Question

Quizplus · Accepted Answer

The population of total compensations of CEOs in the service industry is approximately normally distributed.

A Marketing Research Company Is Estimating the Average Total Compensation